MGM closes within prior day's range
MGM Resorts International (MGM) Technical Analysis Report for Oct 12, 2018
MGM ended the week 0.8% higher at 26.45 after gaining $0.50 (1.93%) today, outperforming the S&P 500 (1.42%). Closing within the prior day's range, prices missed to decisively move beyond the previous day's trading range.
Daily Candlestick Chart (MGM as at Oct 12, 2018):
Friday's trading range has been $0.68 (2.56%), that's slightly below the last trading month's daily average range of $0.75. Things look different on the weekly timeframe, where the market's trading range of the last week has been slightly above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for MGM.
During the whole day, prices traded within the prior day's range, unable to trade above the previous day's high or below the prior day's low forming an Inside Bar. Additionally, one bullish candlestick pattern matches today's price action, the Takuri Line. The last time a Takuri Line showed up on September 25th, MGM actually lost -0.97% on the following trading day.
Prices are trading close to the key technical resistance level at 26.47 (R1). After having been unable to move above 26.79 in the previous session, the market ran into sellers again around the same price level today, failing to move higher than 26.67.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
Selling could accelerate should prices move below the close-by swing low at 25.70 where further sell stops might get activated. 2017's low at 25.15 is within reach and we could see further downside momentum should MGM Resorts break out beyond.
Among the four market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Close to Swing Low" stand out. While it is usually interpreted as neutral, it has actually shown to be bullish for MGM Resorts. Out of 708 times, MGM closed higher 50.00% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the long side has been after 10 trading days, showing a win rate of 51.84% with an average market move of 1.10%.